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Michael Kelly v. Borough of Union Beach

February 8, 2011


The opinion of the court was delivered by: Thompson, U.S.D.J.




This matter has come before the Court upon Defendants Borough of Union Beach and Borough of Union Beach Police Department's Motion to Dismiss Plaintiff's Complaint [docket # 7]. Plaintiff Michael Kelly opposes the motion and also seeks leave to amend the Complaint [16]. The Court has decided the motion upon the submissions of both parties and without oral argument, pursuant to Fed. R. Civ. P. 78(b). For the reasons stated below, Defendants' motion to dismiss is granted in part and denied in part, and Plaintiff's motion to amend is granted.


This case arises out of Defendants' alleged failure to pay Plaintiff for over 5,200 hours of accrued compensatory time. (Compl. ¶ 8) [1]. Plaintiff Michael Kelly worked for the Defendants as a police officer from 1986 until September 1, 2009. (Id. ¶ 3.) He served as a Sergeant from 1986 to 1996, as a Captain from 1996 until March 1, 2004, and as Chief of Police effective May 13, 2004 until his retirement on September 1, 2009. (Id. ¶ 4.) From roughly 1995 onwards, Plaintiff covered for other officers that were out with injuries or on military leave. (Id. ¶¶ 5--6.) Plaintiff's Employment Contract provides for "comp time," (Levy Certification I Ex. C, at ¶ 4), which is time accrued for work performed in excess of 40 hours per week, (Br. in Opp'n 5--6.) Plaintiff, like other employees, had the option of using accrued compensatory time to take time off during his employment with Defendants. (Id. at 6.) Given a shortage in manpower, Plaintiff did not utilize his compensatory hours to take time off. (Compl. ¶ 7.) Plaintiff reported in writing to the Borough Clerk the time accrued for each calendar year. (Id. ¶ 8.) As of his retirement, Plaintiff had accrued a total of over 5,200 hours of "compensatory time." (Id.) The Borough's Employee Manual states, "Compensatory time earned and not used as of the date of termination shall be paid in accordance to the provisions of the Fair Labor Standards Act." (Levy Certification I Ex. B, at ¶ B-7.) However, Defendants have not paid the Plaintiff for any of the allegedly accrued time. (Compl. ¶ 11.)

On August 11, 2010, Plaintiff filed the present Complaint [1], alleging a violation of the Fair Labor Standards Act ("FLSA"), 29 U.S.C. § 201 et seq., as well as common law claims including breach of contract, breach of the implied covenant of good faith and fair dealing, quantum meruit, tortious interference with economic advantage, unjust enrichment, and equitable estoppel / detrimental reliance.

Defendants filed a Motion to Dismiss under Fed. R. Civ. P. 12(b)(6) on October 28, 2010 [7].*fn1 They assert that all of Plaintiff's common law claims are preempted by FLSA. (Br. in Supp. 8--11.) They further argue that Plaintiff's employment contract limits his compensatory time to holidays and court appearances, for which Plaintiff has already been paid. (Br. in Reply 7--8) [19]. Finally, Defendants argue that Plaintiff's compensatory-time claims are subject to a 480-hour limit, (Br. in Supp.11--14); that Plaintiff's overtime claims prior to August 11, 2008, are barred by the statute of limitations, (id. 15--17); and that all of Plaintiff's FLSA claims are wholly barred by the "executive employee" exemption, (id.17--20).

Plaintiff opposes the Motion to Dismiss and requests leave to amend [16].


A.Standard of Review for Motion to Dismiss

Under Fed. R. Civ. P. 12(b)(6), the defendant bears the burden of showing that no claim has been presented. Hedges v. United States, 404 F.3d 744, 750 (3d Cir. 2005). A district court must accept as true all of the plaintiff's factual allegations, construe the complaint in the light most favorable to the plaintiff, and determine whether, under any reasonable reading of the complaint, the plaintiff may be entitled to relief. Phillips v. County of Allegheny, 515 F.3d 224, 233 (3d Cir. 2008). To survive a motion to dismiss, a complaint must contain sufficient factual matter to state a claim that is facially plausible. Gelman v. State Farm Mut. Auto. Ins. Co., 583 F.3d 187, 190 (3d Cir. 2009) (citing Ashcroft v. Iqbal, --- U.S. ---, 129 S.Ct. 1937, 1949 (2009) and Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 556 (2007)). Facial plausibility exists where the facts pled allow the court reasonably to infer that "the defendant is liable for the misconduct alleged." Id. (quoting Iqbal, 129 S. Ct. at 193). Facts suggesting the "mere possibility of misconduct" fail to show that the plaintiff is entitled to relief. Id. (quoting Iqbal, 129 S. Ct. at 195).

B.Preemption of State Common Law Claims

Defendants argue that Plaintiff's common law claims must be dismissed because they are preempted by FLSA. (Br. ...

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